Research On Vat Perfection Of Post And Telecommunication Services In China (Shanghai) Pilot Free Trade Zone

Shanghai Free Trade Zone formally established on September 29,2013. It is significant for pioneering, deepening reform and expanding opening up. Differ from the bonded area and bonded port area, the goal of Shanghai free trade zone is to explore reform of the tax system, create a corresponding tax system, and copy the reform experience to the national. In Shanghai free trade zone service enterprise is the main enterprise, turnover tax is the main tax. Therefore, to improve the �VAT instead of business tax� pilot system design and spread it around industry-wide should be a major focus of the tax system reform in Shanghai free trade zone.The �VAT instead of business tax� is the highlight of deepen fiscal and taxation system of our country at present. Postal services and telecommunication services have been joined the pilot of �VAT instead of business tax� on January 1, 2014 and June 1, 2014. It is help to reduce the tax burden of the industry chain, improve the structure of taxation system and line with the international tax system. The development of Shanghai free trade zone is inseparable from the support of post and telecommunication services. The current VAT tax system of post and telecommunication services still exists some problem that need to be improved. These problems have a bad influence on the development of post and telecommunication companies and the basic supporting role to play on Shanghai free trade zone of post and telecommunication services.In the spirit of forming a �replication, replicable� experience which is the guiding principle of Shanghai free trade zone, I think we can continue to explore the VAT of post and telecommunication services in this experimental plots. We can find the unreasonable and unclear points of the VAT system, combined with the theory of tax law and foreign experience, and then make it to perfection in Shanghai free trade zone. When it succeeded in this narrow range after tests, it will be able to promote the experience to the whole country. Not only for the benefit of China's post and telecommunication enterprises can better relying on a favorable tax climate to compete with international companies, but also providing a better support to Shanghai free trade zone. In addition, the experience can be extended to nationwide and eventually promote the development of VAT and national post and telecommunication services.This paper is divided into five chapters, integrated with comparative study and comprehensive analysis.The first chapter focused on the correlation between Shanghai free trade zone and post and telecommunication services. It is an important mission in Shanghai free trade zone that to perfect the �VAT instead of business tax� pilot system of post and telecommunication services.The second chapter is mainly to comment on the VAT of post and telecommunication services. On one hand, it fully affirmed the positive effects of the �VAT instead of business tax�, as well as favorable factors from the perspective of Shanghai free trade zone. On the other hand, it summed up the deficiencies of the VAT system which have close ties with Shanghai free trade zone. Our country has a low level of VAT legislation. In the VAT of express industry, it lacks a clear express definition and has different tax rate after cutting apart the service. In the VAT of telecommunication industry, the related tax with cross-border telecommunication is unclear, and the tax rates are too much.The third chapter mainly analyses the VAT regulations of post and telecommunication services in Sweden, the United Kingdom, New Zealand and the European Union. According to that to get some inspirations from the scope of legislation, taxation, tax rates setting and tax incentives.The forth chapter focused on the theory analysis which including the optimal taxation theory, tax neutral theory, the principle of legislative taxation, the principle of fair taxation and the principle of efficient taxation, so as to provide a theoretical basis for the VAT perfection of post and telecommunication services in Shanghai free trade zone.The fifth chapter is to give suggestions to the VAT perfection of post and telecommunication services in Shanghai free trade zone. Firstly, we can make China's Free Trade Zone Act. So we can use law to maintain the development of Shanghai free trade zone and the others will be established soon after. In order to enhance the legislative level, the tax system which including VAT can be specially stipulated in the act. Secondly, we can through clearly defined express service as a part of the postal service, replacing express service taxable items and harmonization the tax rate of different segments and appropriate increasing the input tax deductible items, for the sake of improving the VAT of express industry in Shanghai free trade zone. So, the development of express industry will be promoted. And express industry can provide a stronger logistic support to Shanghai free trade zone. Thirdly, we should clear the related tax system about cross-border telecommunication business and unify the telecom service VAT rates to facilitate three network convergences, so as to improving the VAT of telecommunication industry in Shanghai free trade zone and promoting the smooth opening and development of value-added telecommunications services.The innovative ideas raised in this article: firstly, this paper is on the angle of Shanghai free trade zone, and combining it with �VAT instead of business tax� of post and telecommunication services. Not only thinking highly of the basic supporting post and telecommunication services give to Shanghai free trade zone, but also taking advantage of this experiment field to perfect VAT of post and telecommunication services. Secondly, this paper doesn't speak generally about post and telecommunication services, but in each section to distinguish it as postal services and telecommunication services. And finally it united them as a whole. However, due to the limits of my ability and foreign language skills, the overseas VAT regulations mainly consult the edited books in China. The empirical research about the specific rules is lacking. In addition, as the lack of practice, taking into account the problems might not be comprehensive enough, inevitably lead to some of the proposals are too idealistic. All the shortage requires the author to further study and research.